Transnational capital and urbanization on the Pacific Rim: an introduction by Mike Douglass I The zyxwvuts transnationalization zyxwv of capital The transnationalization of capital is an extremely recent dimension of world development. Transnational corporations (TNCs), the key agents in the transnationalization process, first gained wide attention in the early 1960s when increases in direct foreign investment in production were found to be outpacing the expansion of international trade (Rowthorn, 1979; Stopford and Dunning, 1982). But the theories and evidence advanced at the time stressed product cycles and oligopolistic competition for the consumer markets of Europe and North America rather than access to low-cost labour in the third world as the principal driving force for their expansion from North Atlantic economies (Vernon, 1966). As summarized by Palloix (1979:73), the essence of the transnationalization process is in the buying of labour power as an international act on the part of the firm. This act, however, remained of secondary concern in the deployment of industry across national boundaries by multilocational firms throughout most of the 1960s. Even when locating branch operations in low-wage economies of the third world, TNCs were more concerned with gaining access to markets almost universally protected by import-substitution policies rather than tapping the potentially vast reserves of industrial labour that these countries held. The implications of achieving unity of productive, commodity and finance capital at the international scale were not fully revealed until TNC investments in export- oriented manufacturing in the third world turned discussion to a new internatio- nal division of labour (NIDL) in the 1970s (Hymer, 1972; Frobel zyx et af., 1980; Jenkins, 1984). The structural transformations implied by the NIDL began to accelerate in the 1970s. leading, in part, to an unprecedented decentralization of production to a handful of newly industrializing countries (NICs). Behind the phenomenal resurgence of Japan as a world economic power, and an equally remarkable appearance of the industrializing ‘four tigers’ zyxw - South Korea, Taiwan, Hong Kong and Singapore - of Asia, the transnationalization process also began to witness the appearance of TNCs from new territorial bases in Asia, including the NICs (Wells, 1983; Esho. 1985). The economies of the Pacific Rim were not only